Launching an ICO costs money. I layout an in depth look as to how much it actually costs to launch an ICO. I’ve attended several blockchain conferences and the first thing that stands out is the number of service firms that directly serve the ICO industry. Yes, doing an ICO is an entire industry unto itself. Now if you’re interested in bootstrapping an ICO use the numbers below as a rough guide. You may very well find providers who will charge less. You will also pick and choose from the smorgasbord of services they provide because you can simply do much of it yourself.

Pre-ICO costs can run as low as $80,000+ for basic services (assume 8 week ad campaign) to $500,000 for an 8 week long ICO. There are also post-ICO costs geared towards “getting the word out” such as a media push through podcasts and YouTube, bounty program management, and community building in different languages. All in, you can see pre-exchange listing cost run up to $1M. My estimates below are based on a few conversations I have had with consulting firms, media outlets, and ICO providers.

I’m reminded of the Gold Rush when I think of this entire industry. Between the 49ers and the shovel sellers, who did better on average? In fact, Levi’s, the jeans maker, rose to prominence by selling their wares to the 49ers.

Lastly, there’s the fee to get on an exchange. Let’s just say you need briefcases worth of funds.

Getting the word out

Not all influencers take fees, remember there are many who strive for journalistic standards. Some take fees over the table and mark their content as sponsored. Some don’t – and that’s troubling in jurisdictions with stringent securities laws.

For the influencers who do charge:

Name drops – little to no effort, low fee

Review/interview – unscripted for the most part, typically charges less

English and Russian languages are included, Korean, Japanese and Chinese languages can be added with extra fee.

Getting listed on exchanges

The process of getting a token listed on an exchange is not very well defined. Exchanges are where the liquidity is for digital assets, so naturally they become a market player who can command impressive fees. Like influencers, not all exchanges take fees to list. Coins can and do get listed because the exchange believes in the project’s success. But for exchanges that do take fees let’s say they are arbitrarily broken down into tiers. Let’s call these tiers: Tier 1, Tier 2, Tier 3, and Tier 4. Tier 1 exchanges commend the highest liquity. Getting listed there gives a token the highest chance for active price action. Prices to get on exchanges are not published anywhere so naturally it leaves outsiders in the dark. A few articles circulating around the web have ranges of $50K to $1M for a listing. Off the cuff, I’ve heard of fees closer to $2M – $4M for Tier 2 exchanges. And you wonder why some ICO hard caps are raising well over $20M. Just add up the fees and you can see why.

If you ran an ICO I’d love to talk to you about refining the estimates here. The more evidence I have the better I can spread the word to other entrepreneurs and projects. Personally, I don’t think many of these fees should be as high as they are. There are many advisors who are willing to support your project with more compelling economic structures that are less cash upfront and tied to bonuses based on the project’s success.